Russian Federation Country Summary
Higher Risk
View full Ratings TableSanctions
Higher Concern
FATF AML Deficient List
Higher Concern
Terrorism
Medium Concern
Corruption
Higher Concern
US State ML Assessment
Higher Concern
Criminal Markets (GI Index)
Higher Concern
EU Tax Blacklist
Higher Concern
Offshore Finance Center
Lower Concern
Please note that although the below Summary will give a general outline of the AML risks associated with the jurisdiction, if you are a Regulated entity then you may need to demonstrate that your Jurisdictional AML risk assessment has included a full assessment of the risk elements that have been identified as underpinning overall Country AML risk. To satisfy these requirements, we would recommend that you use our Subscription area.
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Anti Money Laundering
FATF Status
The Russian Federation is not on the FATF list of AML Deficient countries, however, due to the invasion of Ukraine, FATF has suspended the FATF membership of the Russian Federation.
Compliance with FATF Recommendations
The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Russia was undertaken in 2024. According to that Evaluation, Russia was deemed Compliant for 6 and Largely Compliant for 31 of the FATF 40 Recommendations. It remains Highly Effective for 2 and Substantially Effective for 4 with regard to the 11 areas of Effectiveness of its AML/CFT Regime.
Sanctions
Following Russia's invasion of Ukraine in February 2022, the United States, European Union, United Kingdom, Canada, and several other nations have significantly expanded sanctions against Russia, targeting numerous individuals and entities. These sanctions aim to impose severe economic costs, isolate Russia from the global financial system, and restrict its ability to raise capital, thereby undermining its military and aggressive actions.
Criminality
Rating |
0 (bad) - 100 (good) |
|---|---|
| Transparency International Corruption Index | 22 |
| World Bank: Control of Corruption Percentile Rank | 16 |
The state of crime and corruption in the Russian Federation remains deeply entrenched, with high levels of corruption affecting various sectors, particularly public procurement and law enforcement. Despite some government initiatives aimed at combating corruption, such as increased penalties for bribery and a focus on transparency, the effectiveness of these measures is undermined by a lack of whistleblower protection and a judiciary that is susceptible to political influence.
In terms of criminal markets, Russia is a significant hub for human trafficking, arms trafficking, and cybercrime, with organized crime networks operating with considerable impunity. The concentration of power in the hands of the government, coupled with widespread corruption and limited civil society engagement, hampers resilience to crime and complicates efforts to address these pervasive issues effectively.
Economy
The economy of the Russian Federation is characterized by a complex investment climate that poses significant challenges for foreign investors. Despite being ranked 28th out of 190 economies in the World Bank’s Doing Business 2020 Report, Russia's governance issues, including a biased judicial system and high levels of corruption, continue to deter foreign direct investment. Additionally, ongoing sanctions from the EU and U.S., coupled with restrictive policies favoring local producers, further complicate the investment landscape, making it essential for U.S. investors to navigate a myriad of regulatory and compliance challenges while ensuring adherence to international sanctions.
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